In any planning for the future, you would wish to ensure your family’s financial security. Of the simplest ways and most economical, a term insurance plan fits this bill best. You could thus provide an enormous amount for your loved ones in case something bad happens to you by availing yourself of a term insurance plan. One of the most popular choices is a ₹2 crore term insurance plan that offers heavy coverage. However, how would you fund a coverage plan so high without costing you an arm and a leg? Let’s dive into this.
What is a Term Insurance Plan?
It is a basic form of life insurance product and pays for a person for a term. Upon the death of the policyholder within the term, the sum assured will be handed over to the nominee. It does not carry any maturity benefit and, hence, comes at a cost less than that of most other products.
₹2 crore term insurance can be a saving choice that provides ₹2 crores of cover to protect your family’s finances in case an unfortunate situation arises with you. Such cover is also very handy when you have high financial obligations such as loan repayments, education fees of dependents or regular daily expenses.
Why Should You Consider ₹2 Crore Term Insurance?
Ideally suitable for high financial liabilities, an individual desires the lifestyle of his/her family to remain undisturbed in his/her absence. Major reasons for investing in a term insurance policy of ₹2 crores include:
- Debt cover: it ensures your pending Home loan, Personal loans, or others do not continue to nag your family’s peace.
- Security for the future: The children’s education or your marriage, or any other future event, will be financially sound.
- Maintenance of Lifestyle: A high-value amount ensures that your family can enjoy their lifestyle without any issues or meeting daily needs.
- Tax Advantages: Payments towards the policy qualify for a deduction under Section 80C and the payment received is exempt under Section 10(10D).
How to Save the Minimum Premium on a ₹2 Crore Term Insurance Policy
Here are action tips on how to secure a term insurance plan that is highly valued yet affordable at the premium level:
- Start Early: If you get the term insurance plan early, then naturally, the premium would go lower. Insurance companies take age as their criterion; being younger makes the individual seem healthier and less likely to have any health issues. Getting such a policy around your 20s or early 30s could save you a good chunk in premiums.
- Maintain a Healthy Lifestyle: Lifestyle choices are directly proportional to your premium. Smoking or excessive drinking or unsound health practices raise premiums highly. Insurers usually categorize applicants as smokers and nonsmokers, and the latter pays significantly less in terms of premiums.
- Choose the appropriate tenure of the policy: Significantly, you must select the suitable tenure for your term insurance policy of ₹2 crores. You must be able to fulfil all your liabilities from the proceeds. For example, if you wish to retire at the time of 60 years, your cover must take care of that tenure. It would not do good to unnecessarily extend the tenure since it raises your premium.
- Compare Plans Online: The cheapest premium can be availed in term insurance plans by comparing them online. Several comparison tools are provided, and you can use them to check features, benefits, and premiums offered by various insurers. All this research will enable you to understand what kind of term insurance plan for 2 crores is available and within your budget.
- Annual Premium Payments: You can pay the premium on an annual, quarterly, or monthly basis. The insurer will most likely offer you a discount if you pay your premium annually. This can help you save some money on the policy.
- Go for Increasing Cover: If this is a concern in the light of affordability, then go for an increasing cover. An increasing cover increases the coverage amount over the years but still maintains the first premium low. This is actually a smart way to start on a budget and ensure that future coverage is sufficiently high.
- Avoid Riders You Do Not Need: Riders are additional benefits available along with an additional cost. They are helpful but may not be needed for all the cases. Keep the core benefit of the term insurance plan worth ₹2 crores and avoid overloading your policy with add-ons you do not need.
- Pay Attention to the Claim Settlement Ratio of the Insurer: While you want to have an affordable insurance plan, you should choose a reliable insurer with a good claim settlement ratio. This means that your family will face less hassle when trying to file a claim.
- Buy Directly from the Insurer: Buying term insurance plans directly from the website of the insurer might help reduce some agent commissions and extra charges. Most insurers also provide discounts for online purchases.
- Buy a Regular Medical Check-Up: Insurers are likely to require a medical test before they approve your term insurance policy. Maintaining regular check-ups and having a record of good health will help secure cheaper rates.
Factors Affecting Premium of ₹2 Crore Term Insurance Plan
Many factors determine the premium of a term insurance plan. Once you understand these factors, you will be able to strategize better:
- Age: The more youthful a person is, the lower their premiums.
- Gender: In general, females pay less, as they tend to live longer.
- Occupation: Hazardous industries like mining and construction command higher premiums.
- Policy Tenure: Longer durations may attract higher premiums.
- Coverage Amount: The higher the coverage amount, like ₹2 crore, the higher the premium paid but provides better financial security.
Key Features to Look for in the Best Term Insurance Plan for 2 Crore
- High Claim Settlement Ratio: Choose those insurers which consistently have CSR above 95%.
- Customizable Riders: Accidental death benefit, critical illness cover, or waiver of premium are a few.
- Flexible Payout Options: The plan should give you the option for increasing lump sum or staggered payouts.
- Premium Waivers: Try to find out if premiums are waived in case of a critical illness or disability.
- Conversion to Whole Life Cover: Some term plans provide the facility to convert to whole life cover.
FAQs on Term Insurance Plans
- Can I increase the sum assured later?
Most insurers allow policyholders to increase the cover with time, typically at the important events in one’s life-the marriage or even pregnancy.
- What happens if I fail to pay a premium?
Most policies allow for a grace period of 15-30 days, where the payment is made for the arrears. Failure to do so can lead to policy lapse.
- Do I need a medical check-up?
To buy a high-value plan like ₹2 crore, medical tests are usually mandated to measure your health risk
Conclusion
A term insurance cover worth ₹2 crore is a strong financial shield to safeguard the future of your family. All the above tips will make sure you get the best term insurance plan for 2 crore at reasonable prices. Begin as early as possible, maintain good health, and refer to policies online to choose the right one and thus ensure peace of mind for yourself along with financial security for your family members with ease.
